The past is easier to predict than the future.
Financial markets will always be unpredictable. Trying to time entry and exit from particular investments is difficult. It can lock in losses and result in missing out on future gains.
Sharemarkets hit the depths in early March this year on fears for the future of the financial system and concerns the economic slowdown would rival the Great Depression. However, once some more positive signs appeared on both fronts, sharemarkets staged their strongest increase in years. If you had exited the sharemarket in March 2009 you would have locked in all your losses and missed out on one of the most powerful market comebacks in many years.
That’s why we don’t try to pick where market sentiment is heading, we simply try to pick the best investments. We believe the best way to deal with the unpredictability of markets is to have a clear long-term investment strategy, focus on quality investments that will prove resilient through different market conditions, and diversify investments within particular sectors and across different asset classes.
Find out more about investing in shares
'Put not your trust in money. But put your money in trust.' At the beginning of the last century every back cover of Perpetual Trustees Annual Report bore that sentiment by Oliver Wendell Holmes. Perpetual Trustees, founded in 1886, is the deep foundation on which Perpetual – and its culture – stands. Oliver Wendell Holmes also said, 'have the courage to act instead of react'. He may well have made a fine fund manager.
